35-CERT 1 c84879e35vcert.txt CERTIFICATE CONCERNING TERMS AND CONDITIONS May 27, 2004 Securities and Exchange Commission Judiciary Plaza 450 Fifth Street, NW Washington, DC USA 20549 INTERIM REPORT AND BUSINESS PLAN AMENDMENT UNDER RULE 24 OF THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935 NISOURCE INSURANCE CORPORATION LIMITED 801 E. 86TH AVE. MERRILLVILLE, IN 46410 FILE NO. 70-8905 FILE NO. 70-9371 Gentlemen: In compliance with the terms and conditions of Rule 24 under the Public Utility Holding Company Act of 1935, and the Order of the Commission dated October 25, 1996 authorizing the financing transactions and business activities as more fully described in the Joint Application/Declaration, as amended (the "application"), the undersigned hereby submits the following information applicable to NiSource Insurance Corporation Limited ("NICL") for the July 1, 2003 through December 31, 2003 period. 1. Provide a general description of loss exposure/experience for automobile, "all-risk" property, and general liability insurance coverage. Columbia Insurance Corporation, Ltd. was licensed in 1996 to reinsure certain of the "all risks" property, general and automobile liability risks of Columbia Energy Group ("CEG"), its subsidiaries and associates. NiSource, Inc. acquired CEG on November 1, 2000 and NiSource individual subsidiaries were added to the CEG insurance programs. In 2002, NiSource changed the name from Columbia Insurance Corporation, Ltd. ("CICL") to NiSource Insurance Corporation Limited ("NICL"). In 2002, NICL was given permission to underwrite risks on a direct insurance basis rather than on a pure reinsurance basis. Therefore, NICL now underwrites programs on a direct as well as reinsurance basis depending upon risk and nature of the transaction. At July 1, 2003 the General and Automobile Liability; and All Risks Property reinsurance agreement were renewed at existing terms and conditions. At July 1, 2003 the reimbursement policy for workers compensation was also renewed to NICL on a reinsurance basis. At November 1, 2003, "T&D" (property coverage for transmission and distribution lines) was reinsured to NICL and fully reinsured by a third party. The addition of the T&D coverage poses no loss or credit risk to NICL. Details of the coverage and limits reinsured, by line of business and underwriting year, are provided as Exhibit 1. As further discussed under point 2 below, NICL's loss experience under each of the reinsurance agreements continues to fall within the "expected" range, based on the actuarial analysis of its losses. There have been $20,926,343 in paid claims since inception - $6,310,384 for the period under review. 2. Provide an analysis by subsidiary or associate company of auto liability, general liability, property and expenses incurred during the twelve-month period as compared to premiums paid. For the period under review CICL's incurred loss to earned premium ratios for the policies for the period July 1, 2003 to December 31, 2003 were as follows:
-------------------------------------------------------------------------------- EARNED PREMIUM INCURRED LOSS COVERAGE LINE (7/1-12/31) (INCL. IBNR) LOSS RATIO -------------------------------------------------------------------------------- All Risk Property $1,975,209 $395,430 20.02% T&D $166,667 $0 0.00% General/ Auto Liability $1,400,000 $1,841,792 131.56% Workers Compensation $1,572,292 $1,650,639 104.98% -------------------------------------------------------------------------------- TOTALS $5,114,168 $3,887,861 76.02% --------------------------------------------------------------------------------
The above ratios reflect a conservative reserving position, as is appropriate for a company the size of NiSource Insurance Corporation, Ltd.. 3. Provide an analysis by subsidiary or associate companies of claims paid by NICL on behalf of such subsidiary or associate company and include the lead-in reserve available to NICL and end-of-period reserve balance. Reported beginning-of-period loss reserves and end-of-period loss reserves on NICL's property and liability programs as at July 1, 2003 and December 31, 2003, were $21,577,882 and $20,229,734 respectively. Detail of incurred and paid losses, by line of business and underwriting year, is provided in Exhibit 2. 4. Provide a listing that illustrates the increases and decreases to premiums for each subsidiary or associate company as a result of the operations of NICL and loss experience of each subsidiary as a result of operations of NICL. NICL employs a premium allocation model based on exposure and experience of each subsidiary. Exhibit 3 highlights the model which uses an 80%/20% weighting for experience/exposure to derive premium. Premiums have remained virtually the same except for the property premium which decreased. The corporate reimbursement workers compensation policy results in an increase to reflect the new line of business being added to NICL. 5. Provide a copy of NICL's income statement and balance sheet, including any notes thereto. NICL's income statement and balance sheet including any notes are attached. We look forward to your response and further discussion regarding our business plan amendment. Very truly yours, NISOURCE INSURANCE CORPORATION, LTD. By: /s/ J.W. Grossman ------------------------------------- J. W. Grossman, President NISOURCE INSURANCE CORPORATION, LTD. EXHIBIT 1 INTERIM REPORT RULE 24 File No. 70-8905 DESCRIPTION OF CURRENT BUSINESS WRITTEN FOR THE PERIOD 7/01/03 - 12/31/03
All Risk Property PERIOD PER OCC/ AGGREGATE DEDUCTIBLE FRONTING COMPANY ------------------------------------------------------------------------------------------------------------------------------------ 6/30/96-97 $500,000-$650,000/$3MM $100,000-250,000 Arkwright 6/30/97-98 $500,000-$650,000/$3MM $100,000-250,000 Arkwright 6/30/98-99 $500,000-$650,000/$3MM $100,000-250,000 Hartford Steam Boiler 6/30/99-7/1/00 $500,000-$650,000/$3MM $100,000-250,000 Hartford Steam Boiler 7/1/00-01 $500,000-$650,000/$3MM $100,000-250,000 Hartford Steam Boiler 7/1/01-02 $500,000-$650,000/$3MM $100,000-250,000 AEGIS 7/1/02-03 Onshore Gas: $750,000/$2.25M $250,000 AEGIS All Onshore Assets: $3MM/$6MM $1MM,$1.5MM,$2MM AEGIS 7/1/03-04 $3MM/$6MM $1MM - $2MM AEGIS General/Auto Liability PERIOD LAYER/PER OCC/AGG LIMIT ATTACHMENT FRONTING COMPANY ------------------------------------------------------------------------------------------------------------------------------------ 7/1/96-97 Primary US$800,000/3,000,000 $200,000 AEGIS Excess US$1,000,000/1,000,000 $1,000,000 AEGIS 7/1/97-98 Primary US$800,000/3,800,000* $200,000 AEGIS Excess US$1,000,000/1,500,000* $1,000,000 AEGIS 7/1/98-99 Primary US$800,000/3,000,000 $200,000 AEGIS Excess US$1,000,000/1,000,000 $1,000,000 AEGIS 7/1/99-00 Primary US$800,000/3,000,000 $200,000 AEGIS Excess US$1,000,000/1,000,000 $1,000,000 AEGIS 7/1/00-01 Primary US$800,000/3,000,000 $200,000 AEGIS Excess US$1,000,000/1,000,000 $1,000,000 AEGIS 7/1/01-02 Primary US$800,000/3,000,000 $200,000 AEGIS Excess US$1,000,000/1,000,000 $1,000,000 AEGIS 7/1/02-03 Primary US$800,000/3,000,000 $200,000 AEGIS Excess US$1,000,000/1,000,000 $1,000,000 AEGIS
NISOURCE INSURANCE CORPORATION, LTD. EXHIBIT 1 INTERIM REPORT RULE 24 File No. 70-8905 DESCRIPTION OF CURRENT BUSINESS WRITTEN FOR THE PERIOD 7/01/03 - 12/31/03 7/1/03-04 Primary US$800,000/3,000,000 $200,000 AEGIS Excess US$1,000,000/1,000,000 $1,000,000 AEGIS Transmission and Distribution PERIOD PER OCC/ AGGREGATE ATTACHMENT FRONTING COMPANY ------------------------------------------------------------------------------------------------------------------------------- 11/1/01-02 $4MM/$4MM $5MM AEGIS 11/1/02-03 $5MM/$5MM $5MM Direct to NICL and Reinsured 11/1/03-04 $5MM/$5MM $5MM Direct to NICL and Reinsured Excess Indemnity-Workers Compensation PERIOD PER OCC/ AGGREGATE ATTACHMENT FRONTING COMPANY ------------------------------------------------------------------------------------------------------------------------------- 7/1/02-03 $450,000/$6,000,000 $50,000 Travelers (Bermuda) 7/1/03-04 $450,000/$6,000,000 $50,000 Travelers (Bermuda)
NISOURCE INSURANCE CORPORATION, LTD. INTERIM REPORT RULE 24 File No. 70-8905 EXHIBIT 2 INCURRED AND PAID LOSSES FOR THE PERIOD 7/01/03 - 12/31/03
Lead-in loss Paid losses OSLR at IBNR at Closing Updated Movement from Policy Year Coverage reserves in period 12/31/03 12/31/03 Reserve incurred 7/01/03 ----------------------------------------------------------------------------------------------------------------------------------- 7/1/96-97 AL/GL 578,503 - - 174,560 174,560 174,560 (403,943) 7/1/97-98 AL/GL 948,242 - 595,001 511,358 1,106,359 1,106,359 158,117 7/1/98-99 AL/GL 670,572 - 236,998 140,277 377,275 377,275 (293,297) 7/1/99-00 AL/GL 1,742,136 997,401 666,002 591,445 1,257,447 2,254,848 512,712 7/1/00-01 AL/GL 1,390,298 - 401,000 1,193,984 1,594,984 1,594,984 204,686 7/1/01-02 AL/GL 3,603,850 1,238,086 275,000 2,252,406 2,527,406 3,765,492 161,642 7/1/02-03 AL/GL 4,000,000 - 50,000 3,344,256 3,394,256 3,394,256 (605,744) 7/1/03-04 AL/GL - - - 1,841,792 1,841,792 1,841,792 1,841,792 6/30/96-97 All Risk - - - - - - - 6/30/97-98 All Risk - - - - - - - 6/30/98-99 All Risk 173,716 54,795 - - - 54,795 (118,921) 6/30/99-7/1/00 All Risk - - - - - - - 7/1/00-01 All Risk 650,000 - 650,000 26,290 676,290 676,290 26,290 7/1/01-02 All Risk 775,000 1,182,980 - 160,336 160,336 1,343,316 568,316 7/1/02-03 All Risk 4,072,264 2,837,122 750,000 751,500 1,501,500 4,338,622 266,358 7/1/03-04 All Risk - - - 395,430 395,430 395,430 395,430 7/1/02/03 Excess Ind- WC 2,973,301 - 1,104,094 2,467,366 3,571,460 3,571,460 598,159 7/1/03/04 Excess Ind- WC - - 21,106 1,629,533 1,650,639 1,650,639 1,650,639 ------------------------------------------------------------------------------------------------------------------------------------ Subtotal 21,577,882 6,310,384 4,749,201 15,480,533 20,229,734 26,540,118 4,962,236 ------------------------------------------------------------------------------------------------------------------------------------ 21,577,882 6,310,384 4,749,201 15,480,533 20,229,734 26,540,118 4,962,236 ================================================================================================= INCEPTION TO DATE Period Coverage Line Paid losses ---------------------------------------------------- 7/1/96-97 General Liability 726,613 7/1/97-98 General Liability 2,198,577 7/1/98-99 General Liability 1,412 7/1/99-00 General Liability 2,742,556 7/1/00-01 General Liability 2,405,015 7/1/01-02 General Liability 1,238,086 7/1/02-03 General Liability - 7/1/03-04 General Liability - 6/30/96-97 All Risk - 6/30/97-98 All Risk 1,423,776 6/30/98-99 All Risk 2,004,479 6/30/99-7/1/00 All Risk 2,168,952 7/1/00-01 All Risk 664,511 7/1/01-02 All Risk 2,085,136 7/1/02-03 All Risk 3,267,230 7/1/03-04 All Risk - 7/1/02-03 Excess Ind-WC - 7/1/03-04 Excess Ind-WC - ---------- Total 20,926,343 ==========
NISOURCE INSURANCE CORPORATION, LTD. EXHIBIT 3 INTERIM REPORT RULE 24 File No. 70-8905 PREMIUM ALLOCATION MODEL FOR THE PERIOD 7/1/03-12/31/03 Total NICL Premium Allocation
Line of Business GL/AL Property Exc Ind-WC T&D Totals ---------------------------------------------------------------------- Premium Account 2,700,000 3,750,000 3,000,000 1,000,000 10,450,000 ---------------------------------------------------------------------- ---------------------------------------------------------------------- Weighting Weighting Weighting Weighting Weighting ---------------------------------------------------------------------- Exposure 80.00% 80.00% 80.00% 80.00% 80.00% Loss 20.00% 20.00% 20.00% 20.00% 20.00% ------------------------------------------------------------------------------------------------------------------------------------ GL/AL Property Exc Ind-WC T&D Exposure/Loss Exposure/Loss Exposure/Loss Exposure/Loss Selected Allocation Allocation Allocation Allocation W/AVG Code Operating Company Factor Factor Factor Factor Premium ==================================================================================================================================== CKY Columbia Gas of Kentucky, Inc. 52,920 3,750 52,200 - 108,870 CMD Columbia Gas of Maryland, Inc. 19,710 1,875 12,300 - 33,885 COH Columbia Gas of Ohio 544,590 62,625 390,000 - 997,215 COS Columbia Gas of Virginia 95,580 7,500 68,100 - 171,180 CPA Columbia Gas Pennsylvania 236,520 14,625 207,900 - 459,045 TCO Columbia Gas Transmission Corp 340,200 331,500 367,500 - 1,039,200 CGT Columbia Gas Transmission Co 72,090 590,250 80,700 - 743,040 CNR Columbia Energy Resources, Inc. 97,470 304,500 129,600 - 531,570 CTC Columbia Transmission Comm - 2,250 295 - 2,545 PLP Columbia Propane Corporation LP - - - - - CPC Columbia Propane Corporation - - - - - PET Columbia Petroleum Corporation - - - - - CLG Columbia LNG Corporation - - - - - CNS Columbia Network Services 270 - - - 270 CAT Columbia Atlantic Trading Corporation - - - - - CPL Columbia Pipeline Corp - - - - - CFC Columbia Finance Corp - - - - - CEC Columbia Electric Corporation - - - - - CSP Columbia Energy Group Service 2,970 - 2,100 - 5,070 CG Columbia Energy Group - Parent - - - - - TCC Columbia Energy Group Capital - - - - - CTL Columbia Transcom - - - - - NCS NiSource Corporate Services 90,720 3,375 474,900 - 568,995 NSI NiSource Inc. 810 - - - 810 NIP NIPSCO - Electric Merchant 249,480 1,597,875 192,600 - 2,039,955 NIP NIPSCO - Electric Distribution 170,370 355,875 422,100 1,000,000 1,948,345 NIP NIPSCO - Gas Distribution 411,210 38,250 316,800 - 766,260 NDC NiSource Development 3,510 4,875 - - 8,385 NES NI Energy Services - - - - - NET NiSource Energy Technologies - - 3,300 - 3,300 KGF Kokomo Gas 18,360 1,500 14,700 - 34,560 NIF NO. IN. Fuel & Light 20,790 1,875 14,700 - 37,365 BSG Bay State Gas 194,670 25,500 219,300 - 439,470 NPG NiSource Pipeline Group - - - - - EUS Energy USA 2,970 2,625 - - 5,595 PEI Primary Energy 22,410 391,500 6,600 - 420,510 GSG Granite State Gas Transmission 14,580 1,500 1,200 - 17,280 NUM Northern Utilities - Maine 19,170 1,875 7,200 - 28,250 NUN Northern Utilities - New Hampshire 17,550 2,250 15,900 - 35,700 NFC NiSource Finance Company - - - - - NCP Crossroads Pipeline Company 1,080 2,250 - - 3,330 IWC IWC Resources - - - - - ---------- ----------------------------------------------------------------------------------------------------------------------- TOTALS 2,700,000 3,750,000 2,999,995 1,000,000 10,450,000 -----------------------------------------------------------------------------------------------------------------------
NISOURCE INSURANCE CORPORATION LTD. EXHIBIT 4 INTERIM REPORT RULE 24 File No. 70-8905 PREMIUM ALLOCATION FOR THE PERIOD 7/1/03-12/31/03
GL/AL Property Exc Ind-WC T&D Totals ----------------------------------------------------------------------- Allocated Premium Amount: 2,700,000 3,750,000 3,000,000 1,000,000 10,450,000 ----------------------------------------------------------------------- Actual Premium Amount: 2,800,000 3,950,417 3,144,583 1,000,000 10,895,000 ----------------------------------------------------------------------- Weighting Factors Exposure 80.00% Loss 20.00% ---------------------------------------------------------------------------------------------------------------------------------- GL/AL Property Exc Ind-WC T&D Exposure/Loss Exposure/Loss Exposure/Loss Exposure/Loss Selected Allocation Allocation Allocation Allocation W/AVG Code Operating Company Factor Factor Factor Factor Premium ================================================================================================================================== CKY Columbia Gas of Kentucky, Inc. 1.96% 0.10% 1.74% 0.00% 108,870 CMD Columbia Gas of Maryland, Inc. 0.73% 0.05% 0.41% 0.00% 33,885 COH Columbia Gas of Ohio, Inc. 20.17% 1.67% 13.00% 0.00% 997,215 COS Columbia Gas of Virginia 3.54% 0.20% 2.27% 0.00% 171,180 CPA Columbia Gas of Pennsylvania 8.76% 0.39% 6.93% 0.00% 459,045 TCO Columbia Gas Transmission Corp 12.60% 8.84% 12.25% 0.00% 1,039,200 CGT Columbia Gulf Transmission Co 2.67% 15.74% 2.69% 0.00% 743,040 CNR Columbia Natural Resources, Inc. 3.61% 8.12% 4.32% 0.00% 531,570 CTC Columbia Transmission Comm 0.00% 0.06% 0.01% 0.00% 2,545 PLP Columbia Propane Corporation LP 0.00% 0.00% 0.00% 0.00% - CPC Columbia Propane Corporation 0.00% 0.00% 0.00% 0.00% - PET Columbia Petroleum Corporation 0.00% 0.00% 0.00% 0.00% - CLG Columbia LNG Corporation 0.00% 0.00% 0.00% 0.00% - CNS Columbia Network Services 0.01% 0.00% 0.00% 0.00% 270 CAT Columbia Atlantic Trading Corporation 0.00% 0.00% 0.00% 0.00% - CPL Columbia Pipeline Corp 0.00% 0.00% 0.00% 0.00% - CFC Columbia Finance Corp 0.00% 0.00% 0.00% 0.00% - CEC Columbia Electric Corporation 0.00% 0.00% 0.00% 0.00% - CSP Columbia Energy Group Service 0.11% 0.00% 0.07% 0.00% 5,070 CG Columbia Energy Group - Parent 0.00% 0.00% 0.00% 0.00% - TCC Columbia Energy Group Capital 0.00% 0.00% 0.00% 0.00% - CTL Columbia Transcom 0.00% 0.00% 0.00% 0.00% - NCS NiSource Corporate Services 3.36% 0.09% 15.83% 0.00% 568,995 NSI NiSource Inc. 0.03% 0.00% 0.00% 0.00% 810 NIP NIPSCO - Electric Merchant 9.24% 42.61% 6.42% 0.00% 2,039,955 NIP NIPSCO - Electric Distribution 6.31% 9.49% 14.07% 100.00% 1,948,345 NIP NIPSCO - Gas Distribution 15.23% 1.02% 10.56% 0.00% 766,260 NDC NiSource Development 0.13% 0.13% 0.00% 0.00% 8,385 NES NI Energy Services 0.00% 0.00% 0.00% 0.00% - NET NiSource Energy Technologies 0.00% 0.00% 0.11% 0.00% 3,300 KGF Kokomo Gas 0.68% 0.04% 0.49% 0.00% 34,560 NIF NO. IN. Fuel & Light 0.77% 0.05% 0.49% 0.00% 37,365 BSG Bay State Gas 7.21% 0.68% 7.31% 0.00% 439,470 NPG NiSource Pipeline Group 0.00% 0.00% 0.00% 0.00% - EUS Energy USA 0.11% 0.07% 0.00% 0.00% 5,600 PEI Primary Energy 0.83% 10.44% 0.22% 0.00% 420,510 GSG Granite State Gas Transmission 0.54% 0.04% 0.04% 0.00% 17,280 NUM Northern Utilities - Maine 0.71% 0.05% 0.24% 0.00% 28,245 NUN Northern Utilities - New Hampshire 0.65% 0.06% 0.53% 0.00% 35,700 NFC NiSource Finanace Company 0.00% 0.00% 0.00% 0.00% - NCP Crossroads Pipeline Company 0.04% 0.06% 0.00% 0.00% 3,330 IWC IWC Resources 0.00% 0.00% 0.00% 0.00% - ---------------------------------------------------------------------------------------------------------------------------------- TOTALS 100.00% 100.00% 100.00% 100.00% 10,450,000 ----------------------------------------------------------------------------------------------------------------------------------
NISOURCE INSURANCE CORPORATION, LTD. INTERIM REPORT RULE 24 EXHIBIT 5 Estimated savings - captive compared to commercial insurance File No. 70-8905 7/1/03-12/31/03
NICL Option Cum Policy Period 1996-97 1997-98 1998-99 1999-00 2000-01 2001-02 2002-03 2003-04 Premium ----------------------------------------------------------------------------------------------------------------------------------- GL/AL 3,250,672 3,949,662 3,190,770 3,041,000 2,812,000 2,800,000 2,700,000 2,800,000 All-Risk 1,397,203 1,618,057 1,960,760 2,400,000 2,646,000 2,580,000 4,330,000 3,950,417 LTD - - - 4,588,000 7,627,823 2,297,484 1,595,784 432,365 WC - - - - - - 3,050,000 3,144,583 -------------------------------------------------------------------------------------------------------------- Total 4,647,875 5,567,719 5,151,530 10,029,000 13,085,823 7,677,484 11,675,784 10,327,365 46,159,431 Investment Income o/s Pre-tax saving 602,125 179,511 79,149 1,242,900 1,538,582 1,089,748 1,464,216 1,272,635 4,732,016 ---------- Total Cost 41,427,415 Guaranteed Cost Option Policy Period 1996-97 1997-98 1998-99 1999-00 2000-01 2001-02 2002-03 2003-04 ------------------------------------------------------------------------------------------------------------------------------------ GL/AL 2,750,000 3,159,730 2,552,616 3,345,100 3,233,800 3,240,000 3,240,000 3,000,000 All-risk 2,500,000 2,587,500 2,678,063 2,880,000 3,000,000 3,000,000 5,000,000 4,500,000 LTD - - - 5,046,800 8,390,605 2,527,232 1,650,000 800,000 WC - - - - - - 3,250,000 3,300,000 --------------------------------------------------------------------------------------------------------------- Total 5,250,000 5,747,230 5,230,679 11,271,900 14,624,405 8,767,232 13,140,000 11,600,000 50,891,447 ANNUAL SAVINGS 11.47% 3.12% 1.51% 11.03% 10.52% 12.43% 11.14% 10.97% CUMULATIVE INVESTMENT INCOME (EST.) 5,500,000 CUMULATIVE SAVINGS 20.11%
NiSource Insurance Corporation, Limited Management Accounts - consolidated for the period ending December 31, 2003 ------------------------------------ NISOURCE INSURANCE CORPORATION, LTD. CONSOLIDATED INCOME STATEMENT ------------------------------------
-------------------------------------------------------------------------------------- 12 months to 12 months to Company 31-Dec-02 31-Dec-03 Code -------------------------------------------------------------------------------------- REVENUE Premium written - General Liability 2,700,000 2,800,000 See sch Premium written - All Risk 4,330,000 3,950,417 See sch Premium written - Long term 1,946,634 1,230,257 Premium written - WC 3,050,000 3,144,583 Premium written - T&D 1,000,000 1,000,000 Premium ceded - T&D (990,000) (990,000) Premium written - COH - 250,000 Premium ceded - COH - (247,500) Premium written - TCO - 250,000 Premium ceded - TCO - (247,500) Claims servicing fees - - ------------ ------------ 12,036,634 11,140,257 Movement in unearned premiums (2,331,416) 91,664 See sch ------------ ------------ Net earned premium 9,705,218 11,231,921 ------------ ------------ EXPENSES Gross Incurred Claims 7,127,751 10,436,451 ------------ ------------ Net Claims $ 7,127,751 $ 10,436,451 ------------ ------------ UNDERWRITING EXPENSES Deferred acquisition costs incurred 277,037 236,045 ------------ ------------ ADMINISTRATION EXPENSES Management fees 135,000 137,500 Bank charges 9,183 15,440 Corporate secretarial fees 6,355 5,783 Audit fees 40,227 41,816 Government fees 8,536 9,661 Letter of credit costs 39,848 47,517 Legal costs - reinsurance security - - Underwriting consultancy fees 97,474 267,803 Service Corporation expenses 149,455 39,938 CG Fees for set-up of Vermont branch - 51,711 Federal excise tax 11,939 62,623 Miscellaneous expenses 8,945 7,408 ------------ ------------ Total Administration expenses 506,962 687,200 ------------ ------------ Total Expenses $ 7,911,750 $ 11,359,696 ============ ============ Operating Income (Loss) 1,793,468 (127,775) ------------ ------------ INTEREST INCOME & RELATED CHARGES Net interest income - excluding Money Pool 871,634 1,361,710 Money Pool interest income - Non-Affiliated 5 4 Money Pool interest income - Affiliated 1,528 996 Gain (loss) on sale of Investments 131,135 157,817 ------------ ------------ Total Interest Income and Related Charges 1,004,302 1,520,527 ------------ ------------ INCOME (LOSS) BEFORE TAXES $ 2,797,770 $ 1,392,752 ============ ============ Income taxes (1,167,792) (459,610) Deferred taxes 204,738 (28,152) ------------ ------------ Tax (charge) / recovery (963,054) (487,762) ------------ ------------ INCOME (LOSS) AFTER TAXES 1,834,716 904,990 ============ ============ Dividends declared - - CG ------------ ------------ INCOME (LOSS) AFTER TAXES AND DIVIDEND $ 1,834,716 $ 904,990 ============ ============
------------------------------------ NISOURCE INSURANCE CORPORATION, LTD. CONSOLIDATED BALANCE SHEET ------------------------------------
-------------------------------------------------------------------------------------------------- Company 31-Dec-02 31-Dec-03 Code -------------------------------------------------------------------------------------------------- ASSETS Cash 3,314,909 3,725 Cash equivalents - time deposits & Money Market Funds 24,160,178 4,765,641 Money Pool - Non-Affiliated - 10 Money Pool - Affiliated 68,635 14,816 Premiums receivable 48,457 - CG Accrued interest receivable 171,630 472,704 Money Pool accrued interest receivable - Non-Affiliated - - Money Pool accrued interest receivable - Affiliated 121 31 CG Prepaid reinsurance premiums 825,000 907,500 Prepaid expenses 329,340 319,113 OSLR Recoverable - 1,725,000 Funds withhheld (UNUM) 3,633,030 3,662,803 Fixed income investments at market value 11,691,942 34,145,151 Deferred tax asset (general and long-term) 1,709,602 1,673,198 CG ----------- ----------- Total Assets $45,952,844 $47,689,692 =========== =========== SHAREHOLDER'S EQUITY Issued Capital - intercompany 370,000 370,000 CG Contributed Surplus - intercompany 789,059 789,059 CG Additional Paid in Capital 473,019 583,132 Unrealized gain/(loss) on investments 420,662 435,982 Retained Earnings/(Deficit) 5,966,109 6,871,096 ----------- ----------- Total Shareholders' Equity $ 8,018,849 $ 9,049,269 =========== =========== LIABILITIES Accounts payable 110,135 135,192 Accounts payable - System Inc - - CG Accounts payable - Service Corporation - - CS Dividends payable to Parent - - Income taxes payable by Shareholder - prior years - - CG Income taxes payable - Prior years (300) - CG Income taxes payable - Current year 924,166 174,549 CG Unearned premiums - intercompany 5,873,333 5,864,168 See sch Premiums Paid in Advance - intercompany 797,892 - Deferred income - intercompany - - CG Unearned premiums - nonaffiliated - - See sch Reinsurance balance payable 1,039,504 28,780 Outstanding loss reserves 29,189,265 32,437,734 ----------- ----------- Total Liabilities $37,933,995 $38,640,423 =========== =========== ----------- ----------- Total Liabilities and Shareholders' Equity $45,952,844 $47,689,692 =========== ===========